Semicon 2.0: Accelerating semiconductor ecosystem development for global leadership in India
With the scheduled launch of Semicon 2.0 on Sept 17, GoI is signalling that India is ready to move from participation in the global semiconductor value chain to a larger role in shaping it. The policy reflects the need for India's semiconductor strategy to focus on the full ecosystem. But the harder question is how fast and with whom.
That question has a deadline. AI is resetting the scale of semiconductor demand. Based on Semiconductor Equipment and Materials International's (SEMI) World Fab Forecast data, the global semiconductor industry will need more than 50 new fabs from 2029 to 2035 to support build-out of AI infrastructure. Decisions about where those fabs, and supplier bases around them, will sit are being made now, not in 2029.
India has 2-3 yrs to turn policy into permits, land, power, water and qualified suppliers. These ecosystems are not built in a single policy cycle, and countries that move first will shape how the next decade of the industry is built.
India should set its sights beyond volume. Assembly and packaging at scale will create jobs and capacity, and both are worth building. Layers above them - including process technology, equipment, materials and semiconductor IP - are what turn a manufacturing location into an architect of the industry, and India has the talent to compete there. Sequencing and speed will decide how quickly it does.
Semicon 2.0 names the right building blocks: fabs backed by execution certainty for investors, machines and materials, enabling industries, such as equipment, chemicals, gases and precision manufacturing, commercial semiconductor IP built on India's design base, outsourced semiconductor assembly and test (OSAT)/assembly, testing, marking and packaging (ATMP), and advanced packaging, R&D that anchors process and integration knowhow in India, and talent development at scale. Each is necessary, while none is sufficient on its own.
What will separate intent from outcome is the ordinary machinery of industrial delivery: approvals that move at commercial speed, infra delivered ahead of equipment, supplier qualification programmes that begin before a fab is commissioned, and applied training built with universities and industry working together. This work is less visible than a groundbreaking ceremony, but it's what companies weigh when they choose a location, and where India can differentiate itself fastest.
Advanced packaging deserves particular attention because India's and the industry's timelines are aligned here. Performance gains no longer come from smaller nodes alone, they increasingly come from heterogeneous integration, chiplet architectures and system-level design. That shift is still being defined. Therefore, standards, tooling and supplier relationships around it are not yet locked in.
India's existing assembly and test base is a practical entry point into high-volume production. But the larger prize is to move from assembly and test into packaging development, where the design rules, materials and integration know-how feed back into how chips are architected. Building front-end leadership may take more time. But packaging is where the country can win share this decade, and where the design, materials and integration skills that support broader leadership are built.
Global collaboration is the force multiplier. No country can build a complete semiconductor ecosystem in isolation. India's opportunity goes beyond trade, and is to become an integral partner in that network, offering scale, talent and trusted policy support, and building long-term strategic partnerships aligned around shared priorities.
The industry is entering a new era of supply chain transformation, driven by AI demand, geopolitical risk and need for resilience. India can help build supply chains more diversified and resilient. The window to act is over the next few years.
The writer is president-CEO, SEMI
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com)
That question has a deadline. AI is resetting the scale of semiconductor demand. Based on Semiconductor Equipment and Materials International's (SEMI) World Fab Forecast data, the global semiconductor industry will need more than 50 new fabs from 2029 to 2035 to support build-out of AI infrastructure. Decisions about where those fabs, and supplier bases around them, will sit are being made now, not in 2029.
India has 2-3 yrs to turn policy into permits, land, power, water and qualified suppliers. These ecosystems are not built in a single policy cycle, and countries that move first will shape how the next decade of the industry is built.
India should set its sights beyond volume. Assembly and packaging at scale will create jobs and capacity, and both are worth building. Layers above them - including process technology, equipment, materials and semiconductor IP - are what turn a manufacturing location into an architect of the industry, and India has the talent to compete there. Sequencing and speed will decide how quickly it does.
Semicon 2.0 names the right building blocks: fabs backed by execution certainty for investors, machines and materials, enabling industries, such as equipment, chemicals, gases and precision manufacturing, commercial semiconductor IP built on India's design base, outsourced semiconductor assembly and test (OSAT)/assembly, testing, marking and packaging (ATMP), and advanced packaging, R&D that anchors process and integration knowhow in India, and talent development at scale. Each is necessary, while none is sufficient on its own.
What will separate intent from outcome is the ordinary machinery of industrial delivery: approvals that move at commercial speed, infra delivered ahead of equipment, supplier qualification programmes that begin before a fab is commissioned, and applied training built with universities and industry working together. This work is less visible than a groundbreaking ceremony, but it's what companies weigh when they choose a location, and where India can differentiate itself fastest.
Advanced packaging deserves particular attention because India's and the industry's timelines are aligned here. Performance gains no longer come from smaller nodes alone, they increasingly come from heterogeneous integration, chiplet architectures and system-level design. That shift is still being defined. Therefore, standards, tooling and supplier relationships around it are not yet locked in.
India's existing assembly and test base is a practical entry point into high-volume production. But the larger prize is to move from assembly and test into packaging development, where the design rules, materials and integration know-how feed back into how chips are architected. Building front-end leadership may take more time. But packaging is where the country can win share this decade, and where the design, materials and integration skills that support broader leadership are built.
Global collaboration is the force multiplier. No country can build a complete semiconductor ecosystem in isolation. India's opportunity goes beyond trade, and is to become an integral partner in that network, offering scale, talent and trusted policy support, and building long-term strategic partnerships aligned around shared priorities.
The industry is entering a new era of supply chain transformation, driven by AI demand, geopolitical risk and need for resilience. India can help build supply chains more diversified and resilient. The window to act is over the next few years.
The writer is president-CEO, SEMI
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com)
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